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Superannuation
isn’t just a great way to save for your retirement. There are a number of ways
it can benefit you now, such as making your income more tax-effective.

With 30 June
approaching, now is a great time to think about how you can boost your super
savings this financial year and make some smart decisions about your financial
future.

There are
many tax-effective strategies you can implement before the end of financial
year. These opportunities will be different for everyone, so it’s important to
get personal advice about what’s best for you.

Our top five
year-end superannuation strategies are:

1. Salary sacrifice

Salary
sacrifice means asking your employer to put some of your before-tax income into
your super. Salary sacrifice contributions are classified as concessional
contributions and are generally taxed at 15% - which may be much less than your
current marginal tax rate.

Whether
salary sacrifice is right for you will depend on your personal circumstances
and level of income. You also need to be careful not to breach the current
$25,000 cap (or $35,000 if you're over 60) on before-tax contributions, which
includes any Super Guarantee contributions your employer makes on your behalf.

2. Claim a tax deduction on your super contributions

Personal
super contributions made before 30 June, may be claimable as a tax deduction in
your tax return. The amount you claim as a tax deduction will generally be
taxed at 15% - which may also be much less than your current marginal tax rate.

This
strategy is ideal for people running a business as a sole proprietor or in
partnership, as well as some retired or unemployed people. Please seek advice however to ensure this is
an appropriate strategy for your situation as not everyone can claim this
deduction.

3. Protect your family

Underinsurance
is a major issue in Australia, and this can be frightening for you or your
family if you were to get very sick, pass away or become disabled.

You may be
able to get adequate life insurance cover, and pay less for premiums, by
purchasing insurance through your super. This involves holding life insurance
via your super account and using a portion of your super contributions or
account balance to pay for the premiums, rather than paying for the premiums
from your after-tax money.

This
strategy may also reduce your premiums because the super fund is buying the
insurance ‘in bulk’. However, we caution that this strategy may not be suitable
for everyone and we recommend you seek personal advice about your insurance
needs.

4. Take advantage of Government concessions

Many people
can take advantage of the Government concessions available to increase their
super savings, such as the Government co-contribution scheme.

If you are a
low to middle income earner and eligible for the co-contribution, the
Government currently contributes up to $0.50 for each $1 of personal after-tax
contributions you make to your super. This could mean up to an extra $500 in
your super account.

5. Boost your spouse’s super savings

If you have
a low income-earning spouse, you can help top up their retirement savings by
tax-effectively contributing to their super – with a tax offset of up to $540
available.

In certain
circumstances, you could also split your employer super contributions or
personal deductible contributions with your spouse. And if you split
contributions with an older spouse, it may mean accessing tax-free benefits
sooner.

Act now so you don’t miss out

To find out
which year-end super opportunities are best suited to your situation and goals,
contact us on 02 9455 0655 for an obligation free appointment.

This material
is current as at April 2014, but may be subject to change.

This information is of a general nature and
has been prepared without taking account of your personal needs, financial
circumstances or objectives. Before acting on this information you should
consider whether the information is appropriate for you having regard to your
personal needs, financial circumstances or objectives. Please see us for advice
taking into account your individual circumstances. This information is also our
interpretation of the law and does not represent tax advice. Before making any
financial decision, we recommend you obtain professional financial and taxation
advice specific to your circumstances.

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Responsibility for the content and opinions expressed herein rests solely with the author and opinions expressed do not necessarily represent the views and opinions of Professional Wealth Services Pty Ltd. The information on this website is general in nature and may not be relevant to your individual circumstances. You should refrain from doing anything in reliance on this information without first obtaining suitable professional advice. You should obtain and consider a Product Disclosure Statement (PDS) before making any decision to acquire a product. This information is for Australian residents only. Whilst care has been exercised, the taxation information contained is provided as a guide only and may not be relied upon. If in doubt, you should seek independent tax advice from a qualified tax adviser.